Although interested parties have raised concerns about the proposed acquisition’s impact on consumer privacy, the Commission observed that such issues are “not unique to Google and DoubleClick,” and “extend to the entire online advertising marketplace.” The Commissioners further wrote that “as the sole purpose of federal antitrust review of mergers and acquisitions is to identify and remedy transactions that harm competition,” the FTC lacks the legal authority to block the transaction on grounds, or require conditions to this transaction, that do not relate to antitrust.

The FTC statement also says that it evaluated three areas in terms of competition. In summary:

The merger would not eliminate direct competition between the companies.

The merger would not eliminate competition from others in the ad serving space. (Indeed, some CNET have noted how Google seized on theMicrosoft-Viacom ad and content deal announced yesterday as evidence of healthy online ad competition, implying that its acquisition of DoubleClick should be approved. In the article Microsoft reiterates its arguments against the acquisition)

The merger would not allow Google to push AdSense to dominance over other ad programs.

The FTC noted that future changes could trigger a new review, however:

The markets within the online advertising space continue to quickly evolve, and predicting their future course is not a simple task. Accounting for the dynamic nature of an industry requires solid grounding in facts and the careful application of tested antitrust analysis. Because the evidence did not support the theories of potential competitive harm, there was no basis on which to seek to impose conditions on this merger. We want to be clear, however, that we will closely watch these markets and, should Google engage in unlawful tying or other anticompetitive conduct, the Commission intends to act quickly

Google stopped work on a product that would have competed with DoubleClick’s serving platform.

DoubleClick’s marketplace product might have grown to rival AdSense.

Google’s site targeting feature might have developed into a DoubleClick rival.

She also gives a big call out to John Battelle’s book, The Search, and his concept of search engines having a "database of intentions," wondering if the merger will let Google be too strong here:

In many ways, the acquisition of DoubleClick by Google is a case of first impression for the Commission. The transaction will combine not only the two firms’ products and services, but also their vast troves of data about consumer behavior on the Internet. Thus, the transaction reflects an interplay between traditional competition and consumer protection issues. The Commission is uniquely situated to evaluate the implications of this kind of data merger, from a competition as well as a consumer protection perspective. The Commission should maximize its opportunity to do so, especially where the merged firm will be capable of dominating the “Database of Intentions.”

Well, Google already dominates that — so as I’vewritten many times before, concerns that DoubleClick raised about Google could already be acted upon regardless of the merger.

She also raises issue of whether the combination of search and display will help add to a "network effect" that will benefit Google — though Microsoft and Yahoo both have the ability (and are actively pursuing this) as well.

In conclusion, she writes:

I am convinced that the combination of Google and DoubleClick has the potential to profoundly alter the 21 century Internet-based economy – in ways we can imagine, and in ways we cannot.

I do not doubt that this merger has the potential to create some efficiencies, especially from the perspective of advertisers and publishers. But it has greater potential to harm competition, and it also threatens privacy. By closing its investigation without imposing any conditions or other safeguards, the Commission is asking consumers to bear too much of the risk of both types of harm. The unique confluence of competition and consumer protection issues should have been a call to action for this agency – “the only federal agency with both consumer protection and competition jurisdiction in broad sectors of the economy.” Section 5 of the FTC Act is the 30 cornerstone of the Commission’s authority to review a wide range of business practices. The agency embraces its dual, but complementary, missions. While the FTC’s competition and consumer protection missions focus on different types of conduct, they share the same overall goal: that consumers obtain truthful information about products and services that they can then use to make purchase decisions in a competitive marketplace in which their personal information is safeguarded. This purpose has assumed even greater importance in this dynamic, digital, and global marketplace.

With this mission statement as our guidepost, the Commission could have utilized the full scope of its statutory powers to ensure competition was not harmed, while also addressing the privacy issues.

Well, Google itself, as well as its rivals, have already been reshaping things regardless of the merger. Again, if the FTC has concerns, this merger wasn’t necessary to look further at them. But it may be the catalyst for more to come.

Google’s press release notes that now it needs the European Union’s approval to move forward. The EUhas until April 2 to make a decision.